XX. Translate into Ukrainian in written form.

Advertising is defined as the nonpersonal communication of information usually paid for and usually persuasive in nature, about products, services, or ideas by identified sponsors through various media.

Advertising may be classified by target audience (consumer, industrial), by geography (local, international), by medium (radio, newspaper, television), or by its function or purpose (prod­uct advertising, noncommercial advertising, action advertising).

Advertising began in ancient times when most people could not read or write. As manufacturing and communication technol­ogies developed, so did advertising. Printing was the first major technology to affect it, and cable television and computers are the most recent. Since World War II, advertisers have attempted to differentiate products through positioning strategies and other techniques.

As a marketing tool, advertising serves several functions:

- To identify and differentiate products.

- To communicate information about the product.

- To induce the trial of new products by new users and to suggest repurchasing by existing users.

- To stimulate a product's distribution.

- To increase product use.

- To build brand preference and loyalty.

- To lower the overall cost of sales.

Part two

Texts for supplementary reading

TEXT 1

The Field of International Business

International business includes all business transactions that involve two or more countries. Such business relationships may be private or governmental. In the case of private firms the transactions are for profit. Government-sponsored activities in international business may or may not have a profit orientation.

There are three major motivations for private firms to pursue international business. These are to expand sales, to acquire resources, and to diversify sources of sales and supplies.

Sales expansion. Sales are limited by the number of people interested in a firm's products and services and by customers' capacity to make purchases. Since the number of people and the degree of their purchasing power is higher for the world as a whole than for a single country firms may increase their sales potentials by defining markets in international terms.

Ordinarily higher sales mean higher profits. If, for example, each sales unit has the same mark-up, more volume translates to more profits. Lucas film, for example, receives a percentage of the sales made by companies marketing Star Wars merchandise; thus Lucas film's revenues increase with each addi­tional toy that Parker Kenner sells in the United Kingdom. In fact, profits per unit of sales may increase as sales increase. Star Wars cost approximately $10 million to produce; as more people see the film, the average production cost per viewer decreases.

International sales are thus a major motive for firms' expansion into international business. A United Nations study indicated that among the largest industrial firms in the world, about 40 percent of their sales come from outside their home markets.

Resource acquisition. Manufacturers and distributors seek out products and services as well as components and finished goods produced in foreign countries. Sometimes this is to reduce their costs: for example, Lucas film used studios in the United Kingdom in the filming of Star Wars and Kenner manufactures its Laser Pistol in Hong Kong. The potential effects on profits are obvious. The profit margin may be increased, or cost savings may be passed on to consumers, thereby permitting more people to buy the prod­ucts.

Diversification. Companies usually prefer to avoid wild swings in their sales and profits; so they seek out foreign markets and procurement as a means to this end. Lucas film has been able to smooth its yearlong sales somewhat because the summer vacation period (the main season for children's film attendance) varies between the northern and southern hemispheres. It has also been able to make large television contracts during different years for different countries. Many other firms take advantage of the fact that the timing of business cycles differs among countries. Thus while sales decrease in one country that is experiencing a recession, they increase in another that is undergoing recovery. Finally by depending on supplies of the same product or component from different countries, a company may be able to avoid the full impact of price swings or shortages in any one country that might be brought about, for example, by a strike.

1. How would you define the concept ‘international business’?

2. What are the main motives for a firm to join international business?

TEXT 2